DAT: Spot truckload rates mixed

Data is for the week ending Oct. 20

Oct 25, 2012

According to data drawn from its DAT Trendlines and the DAT Network of load boards, TransCore DAT has found that spot-market capacity in the truckload market increased 17% in September, compared to the same month a year ago.

The firm pointed out this rise occurred not just because of inconsistent freight volumes— noting that “for a long time, we’ve heard that trucks may soon be idled due to driver turnover and shortages. Carriers are also feeling the effects of volatile diesel prices.”

Looking on the bright side, continued DAT, “if and when the economy improves and freight comes roaring back, these factors will doubtless force rates up. But demand is not materializing just yet. Carriers are actively looking for freight right now and pricing is competitive.”

As a national average, DAT found that dry-van rates are 5 cents per mile lower this month than they were in October 2011.

“That’s good for shippers and freight brokers but not for carriers,” the firm observed, “unless they specialize in an equipment category, cargo type, or geographic area where demand is high.”

On the other hand, DAT discerned that flatbed rates are sustained at last year's level in October to-date and reefer rates are up 3 cents.

Here are the spot rates by segment as tracked by DAT for the week ending Oct. 20 by segment:

Dry-van rates decreased 0.4% in top markets, while the national average fell 0.8% to $1.31 per mile for linehaul ($1.83 including the fuel surcharge). Four of 12 major van markets are showing growth over a four-week period. Charlotte (+2.3%), Seattle (+1.6%), and Columbus (+1.2%) showed the greatest rate increases. Buffalo (-4.1%), Philadelphia (-3.9%), and Memphis (-2.7%) saw the most significant rate declines for the week. Eight of the twelve top van markets show downward rate trends over a four-week period.

Reefer rates gained 0.1% in top markets, but the national average rate dropped 0.6% to $1.56 per mile for linehaul ($2.10 with the fuel surcharge). Outbound rates rose from Green Bay (+4.5%), Lakeland (+3.0%), and Twin Falls (+2.4%). The greatest rate declines for the week were Grand Rapids (-8.6%), Elizabeth (-3.4%), and Atlanta (-1.4%). Eight major reefer markets show downward rate trends over four weeks.

Flatbed rates fell 4.0% in major markets, while the national average rate declined only 0.06% to $1.72 per mile for the linehaul portion, or $2.29 including the fuel surcharge. Outbound rates rose from Reno (+6.2%), Jacksonville (+4.3%), and Memphis (+1.6%). Just five of the top 16 major reefer markets showed rate growth over a four-week period. Rock Island (-8.4%) and Houston (-7.2%) saw the largest rate declines. Eleven of sixteen major flatbed markets also show downward rate trends over the past four weeks.

While DAT doesn't forecast freight demand, the company told FleetOwner that it can provide “an extraordinary set of data to help fleet managers, owner-operators, brokers and shippers perform their own analysis of demand, rates, and lanes.”

This data include spot and contract market rates based on paid invoices, average fuel surcharges and accessorial charges per mile as well as rates broken down by lane and freight type (van, refrigerated, and flatbed).

In addition, according to DAT industry pricing analyst Mark Montague, the load-to-truck ratio feature of the DAT Load Boards and DAT Truckload Rate Index can is a “demand indicator” for predicting rate changes in specific markets and lanes, so carriers can adjust their pricing accordingly.

He explained that there are three steps that can alert a DAT user in advance to upcoming changes in spot market (broker “buy”) rates for truckload freight:

1. Research demand and capacity patterns in specific markets
2. Watch for changes in the spot market load-to-truck ratio
3. Track the impact of demand and capacity changes on spot market rates

“You can also use your new understanding of spot market rates to predict (or even influence) trends in your shipper customers’ contract pricing, usually two or three months in advance,” Montague noted.